According to a Department of Justice press release, a Pennsylvania businessman recently pleaded guilty to filing false tax returns. This story is important for those taxpayers who believe that they are too small of a fish in a large ocean to be criminally pursued by the IRS or the Department of Justice. If you have failed to file a tax return for one or more years or have taken a position on a tax return that could not be defended upon an audit or criminal tax investigation, you should strongly consider seeking the assistance of an experienced tax defense attorney.
Defendant Overstated Deductions, Now Faces Prison Time
Court records reveal that Jordan Richter was the owner and operator of Diamond Spot Media LLC. His business activities involved selling marketing services to stock promoters. Prosecutors alleged that between 2012 and 2014, Richter inflated his business expenses in order to reduce his overall tax liability. This resulted in the filing of false partnership tax returns for his business and in turn, the filing of false individual tax returns.
Prosecutors and investigators estimate that Richter’s illegal activity resulted in a tax loss of approximately $100,000. Sentencing is scheduled for March of 2021. Richter faces up to three years in prison for each count of filing a false tax return. Additionally, Richter will likely be ordered to serve a period of supervised release. Finally, he will likely be required to pay restitution to the IRS representing the tax loss that he caused.
There Are No Taxpayers Too Small to Face Conviction
This story is a reminder that the IRS and Department of Justice do not only go after those who cause millions of dollars of tax loss. The defendant in the story above caused a tax loss of only $100,000. Such amount is relatively small when considering the number of taxpayers who have skimmed income or overstated deductions. No matter whether your business is large or small, the IRS and Department of Justice will not hesitate to pursue a criminal investigation or charges if tax laws have been broken.
If you have failed to file a tax return for one or more years or have been untruthful about the true amount of income or deduction respectfully earned or incurred, it is critical to understand that there is no fish that is too small to garner the attention of the IRS and their criminal investigators. An experienced tax defense attorney can assist you determine the best method to come into compliance with the IRS or state taxing authority. One of the most valuable benefits of hiring a tax attorney is never having to go up against the tax authorities alone.
Note: As long as a taxpayer that has willfully committed tax crimes (potentially including non-filed foreign information returns coupled with affirmative evasion of U.S. income tax on offshore income) self-reports the tax fraud (including a pattern of non-filed returns) through a domestic or offshore voluntary disclosurebefore the IRS has started an audit or criminal tax investigation / prosecution, the taxpayer can ordinarily be successfully brought back into tax compliance and receive a nearly guaranteed pass on criminal tax prosecution and simultaneously often receive a break on the civil penalties that would otherwise apply.
It is imperative that you hire an experienced and reputable criminal tax defense attorney to take you through the voluntary disclosure process. Only an Attorney has the Attorney Client Privilege and Work Product Privileges that will prevent the very professional that you hire from being potentially being forced to become a witness against you, especially where they prepared the returns that need to be amended, in a subsequent criminal tax audit, investigation or prosecution.
Moreover, only an Attorney can enter you into a voluntary disclosure without engaging in the unauthorized practice of law (a crime in itself). Only an Attorney trained in Criminal Tax Defense fully understands the risks and rewards involved in voluntary disclosures and how to protect you if you do not qualify for a voluntary disclosure.
As uniquely qualified and extensively experienced Criminal Tax Defense Tax Attorneys, KovelCPAs and EAs, our firm provides a one stop shop to efficiently achieve the optimal and predictable results that simultaneously protect your liberty and your net worth. See our Testimonials to see what our clients have to say about us!
We also have lots of success with eggshell audits aimed at detecting skimming and defending IRS and California criminal tax investigations.
We Are Here for You
Regardless of your business or estate needs, the professionals at the Tax Law Offices of David W. Klasing are here for you. We are open for business and our team will help ensure that your business is too. Contact the Law Offices of David W. Klasing today to discuss your business with one of our professionals.
In addition to our main office in Irvine, the Tax Law Offices of David W. Klasing has unstaffed (conference room only) satellite offices in Los Angeles, San Bernardino, Santa Barbara, Panorama City, Oxnard, San Diego, Bakersfield, San Jose, San Francisco, Oakland, Carlsbad and Sacramento. During the COVID-19 pandemic, our staff are working from home, but have full virtual meeting capability.
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Questions and Answers for Criminal Tax Representation
- When tax defense counsel parallels tax crime investigation
- Guilty of tax obstruction by backdating documents?
- To be found guilty of tax obstruction must a person actually be successful in impeding the IRS’s functions?
- Help! The Document I Gave the IRS Had False Information
- Tax crime aiding or assisting false return IRC §7206(2)
- What is the crime known as tax obstruction § 7212?
- What is the difference between tax perjury and tax evasion?
- What is the tax crime commonly known as tax perjury?
- What is a Klein Conspiracy?
- Increased possibility of civil action in IRS investigation
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- Failed to tell IRS about my nominee account
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- 5 Ways to Respond to Tax Evasion Charges
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- How the government proves deficiency in a tax evasion case
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- Requesting conference before investigative report is done
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- What are my rights during an IRS criminal investigation?
- Avoid prosecution for tax crime with voluntary disclosure?
- Defense tactics that make it hard for to prove willfulness
- How a tax attorney can stop your criminal tax case?
- What can you generally tell me about tax crimes?
- Continuing filing requirement with investigation pending
- Federal criminal code crimes that apply to tax issues
- Penalty for making, subscribing, and filing a false return
- CID special agent’s report for criminal prosecution
- What is the discovery process in a criminal tax case?
- What the IRS includes in indictment for tax case
- What is the hardest element of a tax crime to prove?
- IRS methods of gathering evidence to prove tax crime
- What does a grand jury do in IRS tax crime prosecution?
- Failure to keep records or supply information
- Failure to make a return, supply information, or pay tax
- What is attempting to evade payment of taxes?
- What is income tax evasion and how is it punished?
- What is attempted income tax evasion?
- What is the crime of failure to pay tax? What is punishment
- Crime of making or subscribing false return or document
- Criminal Investigation Division investigation tactics
- Tax crimes related to employment tax forms and trust funds
- Tactics to defend or mitigate IRS criminal tax charges
- How the IRS generates leads about suspected tax crimes
- What is the crime ”evasion of assessment” of tax?
- Specific examples of “attempting” to evade tax assessment
- What is the so-called Spies evasion doctrine?
- Does overstating deductions constitute tax evasion?
- Is it tax evasion if my W-4 contains false statements?
- IRC §7201 attempt to evade vs. common-law crime of attempt
- What are the penalties for Spies tax evasion?
- How government proves a taxpayer attempted tax fraud
- What is a tax that was “due and owing.”
- What is evasion of assessment for tax liability?
- Is evasion of assessment different from evasion of payment
- Does the IRS have a dollar threshold for tax fraud?
- What is the IRS burden of proof for tax fraud convictions?
- Are Tax Laws Constitutional?
- What is the source of law that defines tax evasion?
- Does section 7201 create two distinct criminal offenses?
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- Common reasons the IRS and DOJ start investigations
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- What is a proffer agreement and what are the risks?
- Why to have an attorney to review a proffer agreement
- Why enter into a proffer agreement?
- Limited use immunity from proffer agreements
- Difference between civil and criminal fraud alle
